Navigating the rise of corporate activism

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Editor's note: The following is a contributed piece by Jewell Parkinson, head of HR, Americas & APJ at SAP North America​.

You'd be hard pressed to find someone who hasn't been following the conversation around Nike's recent 'Just Do It' campaign featuring Colin Kaepernick. It's the latest in a string of developments that have captivated the world's attention regarding social justice and freedom of speech. If you add Microsoft's recent decision to push partners to provide paid leave for employees that become new parents, you'll quickly spot a trend of companies electing to insert themselves into difficult conversations.

In the traditional sense, corporations were expected to sell products and services, generate profits for shareholders, and pay employees wages that supported growth. However, our world has become increasingly digitized and the lines between individuals' personas at work and at home have blurred along with this transition. Thanks to this integration, consumer and employee demands for corporations have shifted — purpose-driven business is the new normal.

A recent Deloitte survey revealed that millennials and Gen Z'ers are chief among demographics that have shifted their expectations for the companies they work for; beyond money and benefits, they now expect their company and its leaders to "stand for something." Purpose-driven culture must be sewn into the seams of a business and companies must go above and beyond to maintain these values.

In some respects, it's crucial that businesses maintain neutrality on a wide assortment of political and social issues to avoid alienating current and potential stakeholders. With that said, recent studies show a growing support for corporate activism. Speaking out on certain hot-button issues, however, can alienate a company's consumers and employees alike, which raises the question: If a company asserts neutrality on any or all polarizing issues, how can it claim to be socially conscious?

A guiding principle to which I subscribe is that the interest of your internal and external stakeholders must be a top-of-mind consideration when sociopolitical issues enter the workplace. Important questions must be asked: what the company stands for, what its purpose is and what the impact of shying away from acting on issues can have on employee morale. Given these criteria, there will be times when topics and events present consequential opportunities for companies to step up and assert leadership. Under such an occasion, it is important to create safe spaces for respectful and open conversation to set out views which are intended to resonate with the broad sentiments of the stakeholder communities being served.

Multinational, billion-dollar corporations can and should use their power and influence to insert themselves into issues that have both a social and moral implication for their employees and customers, but in a way that is authentic to the business. Nike, for example, has traditionally marketed to the underdogs of the sports world. It has targeted a young audience with its decision to collaborate with Colin Kaepernick and, thanks to the legitimacy of its voice, has thus far experienced market success.

What examples like this demonstrate is that leaders can no longer remain silent on issues that arise outside the workplace, directly impact employees and ultimately encroach on the internal workplace environment. I am reminded of when SAP's CEO, Bill McDermott, responded to the White House's 2017 travel ban because it created a groundswell of concern throughout our globally-distributed organization. Bill saw the need to empower and reassure our workforce with an unequivocal statement on where he — and SAP as a company — stood, with an unwavering commitment to support each and every employee.

Issues like these create a call-to-action for companies to play an integral role and be definitive, as action or inaction directly impacts customers, shareholders and the workforce. It is just as important to anticipate consequences, assess risk and make a decision you can stand by, often with very little time at your disposal. Companies must be aware of the evolving social climate and, when necessary, take a stance that is consistent with company values. Navigating this social landscape can be tricky, but striking a balance between remaining neutral and being vocal is paramount for companies striving for success in today's business landscape.